NEW YORK, USA (AP) — The fight for Starwood Hotels swung back in favour of China’s Anbang after the insurance company offered US$15 billion in a counterpunch to Marriott International.

Starwood Hotels & Resorts Worldwide Inc, which has a tony stable of hotels including the St Regis New York, said yesterday that the offer from the Anbang group is “reasonably likely” to trump a sweetened bid that Marriott submitted last week.

Some industry analysts now believe Marriott will wind up on the losing end of this battle, unless other factors besides price enter the equation.

“We don’t think (Marriott) can go higher, and we would question it if they did,” Canaccord analyst Ryan Meliker wrote in a research note.

Starwood’s board said it is still backing Marriot’s bid while it assesses Anbang’s offer.

Marriott stood behind its last bid “as the best course” for Starwood in a letter yesterday. The Bethesda, Maryland, company also advised Starwood shareholders to scrutinise Anbang’s financing and consider the “timing of any required regulatory approvals”.

That comment appeared to be a veiled reference to the potential hurdles that a Chinese company might have to clear to buy Starwood, which is based in Stamford, Connecticut. Marriot declined to elaborate on its letter.

Anbang dealt with similar concerns two years ago when it acquired the famed Waldorf Astoria of York for nearly US$2 billion. While it tries to hook Starwood, Anbang is also trying to reel in Strategic Hotels & Resorts in a proposed US$6.5 billion deal.

Although Anbang’s purchase of Waldorf was cleared by the US Treasury’s Committee on Foreign Investment, worries about the Waldorf becoming an outpost for Chinese espionage still hang over the hotel. Last year, President Barack Obama, his top aides and staff along with the sizable US diplomatic contingent lodged elsewhere during the annual UN General Assembly, which takes place every September.

The switch ended a decades-long tradition of having presidents and other top US diplomatic officials stay at the Waldorf when in New York. The Government still leases a residence for US ambassador to the United Nations in the Waldorf.

Foreign purchases of hotels and other real estate typically don’t trigger national security concerns in the US unless the locations are near key military bases or other sensitive Government buildings, said Anne Salladin, a special counsel specialising in national security reviews for Stroock & Stroock & Lavan in Washington.

Starwood’s stable includes a W Hotel that overlooks the US Treasury Department in Washington.

Caixin, a financial magazine in China, also has raised the spectre of Anbang’s Starwood bid being derailed by its own Government. That’s because Anbang’s plans to buy Starwood and Strategic Hotels could violate restrictions that limit Chinese insurance companies from having more than 15 per cent of their assets in foreign investments.